The sixth-largest Houston-area wealth management firm, Avalon Advisors LLC, acquired San Antonio investment firm Matterhorn Capital Management LLC in a deal that closed this week.
The terms of the transaction were not disclosed.
Matterhorn Capital Management was once a startup co-founded by Juan Landaand Stefan Grater in 2005. Now both are joining Avalon Advisors' San Antonio office.
"It was a belief that we could do something different and add a higher level of sophistication to portfolio management than what we felt was offered at that time," Landa said about the company's roots.
So what inspired the sale more than a decade later?
"It was about greater resources, products and strategies for our clients," he said.
Harry Flavin was hired at Matterhorn in 2012. Matterhorn Capital is bringing the entire local team, including its equity analyst Jonathan Lewis and the company's chief compliance officer Lindsay Bagby to work for Avalon. In January 2016, a former principal at Matterhorn, Charles Hall, left the company to join Clear Rock Advisors LLC in Austin, according to his LinkedIn profile. Hall took with him about $200 million of assets under management stemming from his clients, since U.S. Securities and Exchange Commissions documents show that the firm had $420 million in assets before his departure.
Matterhorn Capital Management, which focused on equity and fixed income investments, had increased its assets under management from about $150 million in 2011 to $220 million in 2016.
Avalon Advisors had about $5.5 billion in assets under management when it opened an office in the Alamo City in 2014. The firm will have more than $6 billion under management after the Matterhorn acquisition. Most of the clients are high-net worth families, individuals and endowments. The company has about 60 employees split between its Houston and San Antonio offices.
"We knew some of the families that they worked with and how they were respected, and I think vice versa. It just became a natural conversation," said Rob McClane, managing director and client adviser at Avalon Advisors. "We manage the money internally versus outsourcing that to other investment managers."